April Questions and Answers

Joel Emes

Q: Who uses the RRSP tax deduction?

A: Table 1 shows RRSP participation by income group. Half of the total dollar value of RRSP contributions came from those with incomes under $50,000, while 39.5 percent of all RRSP contributors earned between $20,000 and $40,000. Almost a third of the people in the $20,000 through $30,000 income group claimed an RRSP deduction from their income tax in 1995; participation jumps to just below half for the $30,000 through $40,000 group.

Q: How many people contribute to RRSPs? How has this changed over time?

A: In 1982, 2.1 million people, or 14 percent of tax filers, sheltered income in an RRSP. The number and proportion of contributors has been growing steadily ever since. As of 1995, the proportion of tax filers taking advantage of this tax break had doubled to 28 percent, and the number of Canadians who made an RRSP contribution had more than doubled to 5.7 million.

Q: How do RRSP contributions vary with age?

A: In 1995, the proportion of tax filers who made RRSP contributions varied between 3.3 percent for those under 20 years of age, and 41.1 percent for those aged 50 through 59. Table 3 shows the proportion of each age group that made RRSP contributions in 1995 and 1982. This month's graph shows this breakdown for 1995, 1990, 1985, and 1982. Every age group under 60 through 64 reflects the sharp increase in overall RRSP participation. The proportion of Canadians in the 20 through 29 age group who claimed an RRSP deduction has more than tripled between 1982 and 1995 from 6 percent to 21.8 percent.

April Graph

Joel Emes

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Last Modified: Wednesday, October 20, 1999.